ECONPOL, US-specific
Consider the following:
The total net worth of the US is at least $123 trillion. https://en.m.wikipedia.org/wiki/Financial_position_of_the_United_States
Since 2014, that net worth number has risen, it's now over $130 trillion, but I'll use the lower number.
If you split that net worth up per capita, then you get $123 trillion/333 million = $369,369
So, unless you have a net worth of around $370k, you don't own an even piece of the economic pie. For a family of 3 that would be a little over $1.1 million.
ECONPOL
This isn't to say that every person deserves an exactly same sized piece of the economic pie, but in a relatively fair system the median would be close to that mark, and it should be easy to achieve for an average person.
The US median household income is $121,700 with a household size of 2.53.
So, the individual net worth in that household is $43,102 (vs. $369,369) or about 11.6% of what it should be
Scaling up to household, the median household should be around $934,503, not $121,700
ECONPOL
@urusan Aren't you confusing net worth and income here?
ECONPOL
@urusan Ah, right, I just got confused since you mentioned income at some point and then manipulated it in similar ways as the net worth, sorry. >_> After re-reading everything seems mostly fine.
ECONPOL
@timorl Here's a similar analysis of the income situation:
The US GDP is $20.94 trillion. The US population is 333 million, so the per capita GDP is $62,882 (yearly).
The actual US median household income is $67,521. At 2.53 persons per household, that means each individual is making $24,854, or about 39.52% of what it should be (which is somewhat better than 11.6% but not good).
A typical household such as this median household should be making around $159,091, not $67,521.
ECONPOL
@timorl Realistically though, there's other distortion effects in both cases.
In the income case, official economy workers should be making something like 50% to 150% more than that during their productive years, because you are only productive for roughly 48/75=64% of your lifespan, and there's a lot of unpaid unofficial labor (parental child care, etc.) which drives down the labor force participation rate further.
ECONPOL
@timorl In the net worth case, you should hit peak net worth just before retirement.
A newly born child won't have any personal assets, while someone in the median household who's just about to hit retirement should have substantially more than the cited figure.
Of course, due to the statistical nature of the median, this will change who is at the median.
Still, this figure likely represents where a typical person in their 30s or 40s should be, net worth wise.
ECONPOL
@timorl No, that's a separate issue.
Median income is closer to equitable than net worth, though still off by a substantial margin, but both are important issues.
Even with substantial income, a strongly negative net worth will drag down income and reduce financial security, due to interest
Income also doesn't account for expenses, so high rents drain away income that would be retained if those rents were not in place, and having substantial net worth allows one to avoid rents